PhillyDeals: Main Line contractors' insurer faces uncertainty

Olympic medalist Apolo Ohno is featured in this ad for Century 21 developed by local firm Red Tettemer   Partners. It will air during the Super Bowl.
Olympic medalist Apolo Ohno is featured in this ad for Century 21 developed by local firm Red Tettemer Partners. It will air during the Super Bowl.
Posted: January 25, 2012

A Main Line firm that insures construction general contractors and subcontractors against loss faces an uncertain future after a British company canceled plans to buy it.

First Sealord Surety Inc., Villanova, was downgraded to C ("weak") from A- ("excellent") by insurance rating firm A.M. Best & Co. last week, which cited "uncertainty" about First Sealord's scheduled sale to U.K.-based Torus National Insurance Co. and "increased expectation of significant financial deterioration" in First Sealord's next quarterly report.

Indeed, "Torus has elected to terminate its agreement to acquire First Sealord Surety," Torus spokeswoman Laura Molloy told me. Asked why, she didn't respond.

First Sealord, reached by phone, had no comment.

Low ratings make it tough for insurers to sign new business. "In speaking with [First Sealord] yesterday, I understood they are not writing any new bonds," Gordon McLean, senior financial analyst at A.M. Best, told me.

As of September, First Sealord had more than $15 million in premiums, according to the Pennsylvania Insurance Department, with maximum net exposure per surety risk of about $1 million. The company reported a surplus of $10 million in June, but that fell to $5 million at the end of September, according to Best.

While larger companies that write surety bonds, such as CNA, Chubb, Liberty Mutual, Travelers and Zurich, have been able to dip into reserves, McLean said small insurers have suffered particularly from the decline in U.S. construction: "When contractors don't have the funds because a job was canceled, it's a domino effect."

First Sealord moved its offices to Villanova in 2006, three years after it was spun off by Zurich North America. The business, cofounded in 1991 by chief executive Ken Brier and investor Ted Drauschak, was formerly called Mountbatten Surety Co., recalling British admiral Louis Mountbatten, whose titles included First Sea Lord.

Made in Philly

The Eagles didn't make it. But for the first time in the memory of Philadelphia's resurgent advertising industry, local firms have designed national ads that will be shown during the Super Bowl.

Poptent, the Conshohocken agency headed by Scranton native and ex-McDonald's adman Neil Perry, produced an ad for Dannon's line of Greek-style yogurt that will run during next weekend's Patriots-Giants championship game, the ad industry's top showcase.

"It is a big deal. Like we got an Academy Award. Definitely a fun time here," Perry told me.

Poptent, which counts Anheuser-Busch, Avaya, Dell Computer, GlaxoSmithKline, Johnson & Johnson, and Jaguar/Land Rover among its corporate clients, relies not just on its 50 employees (also in San Clemente, Calif.; Sao Paulo; Chicago, and "soon New York"), but also on "up to 43,000 creators," mostly young people with digital cameras, from moonlighting wedding photographers to boutique-design-firm owners to "maybe three" full-time job-shoppers Perry said earn more than $100,000 a year from Poptent work. Perry and his team call their digital collaborations "crowdsourcing."

Perry selected 31 "creators" to pitch Dannon ads. The agency chose two for broadcast and social media.

One, by North Jersey brothers Remy and Andrew Neymarc, in its finished version features actor John Stamos as half of a couple bickering over yogurt.

Perry is Poptent's president. Backers include Rick Parkhill, the Californian who made his pile in 2007 when he sold iMedia Communications to DMG World Media and investment firm MK Capital of Chicago.

Separately, Philadelphia-based Red Tettemer + Partners' executive creative director Steve O'Connell has produced an ad featuring debt-dependent developer Donald Trump, NFL veteran Deion Sanders, and Olympic skating medalist Apolo Ohno for real estate broker Century 21, which is relaunching its brand after the home-sales industry collapse.

Trump, Sanders, Ohno? "We got someone who represents smart, someone who represents bold, someone who represents speed," O'Connell told me. So which is Mr. Smart? "They all say it's them!"

Red Tettemer's clients include Dial soaps, UnderArmour sports clothes, Fox Networks. How'd they land Century 21?

"We reached out to them," said O'Connell, a founder of Stick and Move, bought by Red Tettemer two years ago.

Last year, Red Tettemer put together a print-TV-billboard campaign. "That went well. They decided early in 2011 to follow it up with a Super Bowl ad. The goal is to modernize them, to show them as a smart, forward-thinking company."

"We checked with the Ad Club of Philadelphia, and it looks like the first time ever" that a Philly firm, let alone two, did a national Super Bowl ad, said Red Tettemer's Annie Heckenberger. Both clients plan to distribute the ads via social media next week, in advance of the big game.


Contact Joseph N. DiStefano at 215-854-5194, JoeD@phillynews.com, @PhillyJoeD

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